App Store: The update story
Quite a few apps that I had purchased from the App Store recently, have updates available already. The update process has been directly integrated into the iTunes Applications section:

You can click the Check for Updates link to have iTunes check for updates for any of your applications. You’ll be prompted to sign into the iTunes Store. In case an update is available, iTunes will take you to the an App Store page which will have just the updates specific to your apps listed:

From here you can either click Download All Updates or click the Get Updates button next to each app. I have a feeling that these are not “delta” updates i.e. you end up downloading the complete app (the newer version) all over again. In case of “heavy” games that could mean having to download anywhere between 20-50 MB.
The update process works from iPod Touch/iPhone as well. Just click on the Updates button in the App Store application, select the app you want to update, tap it to go to its detailed description and then click the Update button.

The Update button will turn into a green Install button, tapping on which will ask you for your iTunes Store credentials. After you sign-in, the updated version of the app will start downloading and will eventually replace the existing version on your iPod Touch/iPhone.

Kudos to Apple for having thought through the update/upgrade scenarios!
